IFC and MIGA back Safaricom Ethiopia

The IFC and the Multilateral Investment Guarantee Agency (MIGA) – members of the World Bank Group – announced an equity investment, a loan and guarantees to support the ongoing construction and operation of Safaricom Ethiopia’s greenfield telecommunications network across Ethiopia.

This first partnership between IFC, MIGA, Vodafone, Vodacom, Safaricom, Sumitomo Corporation, and British International Investment in Ethiopia addresses the World Bank Group’s core mandate to help countries end poverty and meet their citizens’ demands for services including digital connectivity.

IFC will make a $157.4 million equity investment in Global Partnership for Ethiopia BV (GPE) and a $100 million A-loan to its wholly owned subsidiary, Safaricom Ethiopia. Following the transaction, IFC will hold a minority position in Safaricom Ethiopia.

MIGA will provide 10-year guarantees of $1 billion to cover the equity investments of Safaricom Ethiopia’s shareholders: Vodafone Group, Vodacom, Safaricom, and British International Investment. A portion of the MIGA guarantees, $76 million, will come from the MIGA Guarantee Facility, part of the International Development Association’s Private Sector Window, in the form of a first loss layer.

Ethiopia is Africa’s second most populous country, with a population of approximately 120 million. The investment and guarantees will help Safaricom Ethiopia roll out and operate 4G and 5G mobile networks across the country – including in rural and urban areas. Furthermore, under a licence granted in May 2023 by the Central Bank of Ethiopia, Safaricom Ethiopia also plans to launch financial services in 2023 under the brand name M-PESA.